A consortium led by US defence technology supplier Raytheon is expected to be confirmed as preferred bidder for the UK government’s £534m e-Borders deal, according to sources close to the negotiations.

The Trusted Borders consortium was selected last week in preference to the BT-led Emblem group, said insiders. The Raytheon bid is said to have had a considerably lower price tag than its competitor.

Under the e-Borders scheme, immigration and government security systems will be linked with transportation hubs to check and log every passenger travelling in and out of the country.

The plan is part of the wider security strategy that includes biometric passports and visas, and the national identity card programme. As preferred bidder, Raytheon will enter into final contractual negotiations before the deal is signed.

“The e-Borders procurement is ongoing and it would not be appropriate to comment on what is a commercially-confidential matter,” said a Home Office spokesman.

e-Borders’ status as a world-leading programme will have affected suppliers’ negotiation strategies, according to Ovum government practice director Eric Woods.

“The ability to look at the deal in terms of the global market will certainly affect the types of pricing under negotiation,” he said.

“US and UK contracts are seen as bellwethers of the worldwide trend for border controls systems, and global players will factor that into their bidding.

“Raytheon has been looking to extend beyond its traditional defence market for some time and border security is an attractive step because it broadens into more IT-oriented areas,” he said.

The Trusted Borders consortium also includes Accenture, Detica and Serco. The BT Emblem group includes Lockheed Martin, LogicaCMG and HP.

Procurement started in October 2005 and originally also included teams led by EDS and German IT provider T-Systems.

e-Borders is scheduled to be fully operational by 2010. A pilot project, started in 2004, has led to more than 1,000 arrests, according to Home Office figures.

BT’s decision not to bid for the ID cards project was widely viewed by the industry as a result of its involvement in e-Borders. But sources at the telecoms giant say it expects to have a role in the ID programme as a sub-contractor to multiple suppliers, rather than as a prime contractor.